One of the main issues dominating public discourse in Berbice recently is the future of the bauxite operations in the Ancient County at Everton and Kwakwani and numerous questions are being posed on the union/management proposal.
Stabroek News
July 7, 2001
Several individuals, organisations, the business community and other stakeholders have expressed concern over the future of the mining company and the likely repercussions on the township of New Amsterdam and its 30,000 odd residents if the Everton operations are closed.
Over recent weeks the Guyana Bauxite and General Workers Union (GB&GWU) which represents supervisors has been at the forefront of a lobby for a proposal submitted by the Bermine Employees Group/Centrotrade Minerals and Metals Inc. (CTMM).
This past week Alcoa demanded a "direct response" from the Guyana government to its concept paper. It warned that if it did not receive a positive response at least in principle to the major elements of the paper, it would no longer support the proposal. Yet while the public discourse in the media has been led by the GB&GWU and to a lesser extent the government, those who are at the centre of the dilemma, the workers, have been silent.
Stabroek News recently spoke with a number of employees and some professionals close to the company who posed several questions and concerns about the company's status quo and its future.
Amidst many insecurities troubling most of the 270 employees at Everton, the Employees/Investor proposal also came under severe scrutiny. According to a number of workers, there is a worrying paucity of information on the proposal submitted by the Employees Group/Strategic Investor.
"We are not being told about the fine print of the proposal by the Unions or management," said one employee with several years service.
While referring to the Alcoa proposal as "greedy", the employee expressed reservations about the present management running the company under a possible worker buy-out saying "they have been there for some time and have not been very successful. Even today we are still experiencing problems with payment of salaries. Apart from this there is no guarantee of re-employment in the new company."
The workers were, however, in the main reluctant to invest their redundancy funds into the proposed company, expressing fears for the security of their investment. "We would like to know how and when we will be paid our redundancy money and we are prepared to raise this issue with the President as soon as it is possible to meet him."
The government is expected to pay Bermine employees approximately $262M under a redundancy package. According to another worker "we do not have a say in anything, we have not been given any details on CTMM, whether the same management will run the new company and whether we will be guaranteed employment with the new company in which we are being asked to buy shares from our redundancy money. It is also very strange that the GB&GWU is now suddenly purportedly fighting for us when it was silent over recent years when the company was sliding into problems."
He declared that "workers are not willing to invest their money into any new company."
Workers, expressing fear of victimisation, were unwilling to reveal their identities and in some cases were reluctant to speak with this newspaper.
Meanwhile, the questions being raised continue to increase and workers are calling for answers. What percentage of shares will be held by them and by the Strategic Investor? Is the investor using the employees to buy the company at a cheap price in the name of an employee buy-out. What is the purchase consideration and how will this be satisfied - by cash, loans, whatever? How will workers benefit from buying shares in the new company? Would they receive dividends annually at a level above or consistent with interest offered by most commercial banks? Will the existing management continue, particularly in view of the huge trade losses incurred over the years? What system will exist for workers to participate in the management of the new company? Will the new company absorb the existing labour force or will the operations be rationalised to make it globally competitive?"
Some workers are also concerned about CTMM, the strategic investor and are asking several questions which they say require immediate answers. "What is the trading history of this company?" asked another employee.
"What is its date of incorporation, the names of the Directors, its authorised and issued share capital and its audited finances for the last few years?" One asked "Does the company have the financial capability to provide the working capital of US$500,000 per month and what would be the conditions attached?"
"Will the new company take over the existing liabilities or will the government absorb these?", asked another. "Do the proposed owners have a strategic business plan. Could the new company sustain a loan of US$7M?"
A professional close to the industry who also spoke with Stabroek News questioned what will be the position of the union three years down the line when Alcoa's ore reserves are exhausted and the operations close down with 800 workers losing their jobs.
Dredging of the Berbice River, he said, will also cease and Viceroy's operations will close.
"The termination of Alcoa's proposal," he contended, "could be the end for the bauxite industry in Guyana and it will be difficult to attract investors. The Directors of Bermine should make available to the employees and other stakeholders the audited financial statement from incorporation. This will allow an informed and objective assessment of the stewardship and also help to determine whether the existing leadership should form part of the new company."
Earlier this week Alcoa repeated its warning to seek an alternative resolution of its situation in Guyana.